According to analysts at VanEck, Bitcoin's hashrate fell by 4% in the month ending December 15th. This move caught the attention of market watchers, as hashrate declines in the past have often preceded price increases.
VanEck's Matt Siegel and Patrick Busch point to a historical pattern in which Bitcoin's 90-day forward return was positive 65% of the time when the hashrate fell over the past 30 days, compared to 54% when the hashrate rose. Numbers are important here, and traders treat them as part of the evidence mix.
Hashrate compression can inform recovery
Reports have revealed that a longer time horizon appears to be advantageous for the bulls. When the hashrate shrunk and remained at a low level, the chances of recovery improved more broadly. Following 90 days of negative hashrate growth, Bitcoin's 180-day return was positive 77% of the time, with an average return of 72%.
Source: VanEck
The calculations are clear and the pattern is consistent enough to get investors' attention. The economic situation of the miners also adds to this story. The breakeven electricity price for the 2022 Bitmain S19 XP has fallen nearly 36% from $0.12/kWh in December 2024 to $0.077/kWh by mid-December. This change will squeeze margins and force stretched operators to rethink their rigs.
Miner withdrawal, market surveillance
Some capacity has left the network. VanEck links the recent 4% decline to the shutdown of about 1.3 gigawatts of mine power generation in China. Analysts also warn that rising demand for AI computing could take capacity away from Bitcoin, a trend that could wipe out 10% of the network's hashrate.
This could redistribute mining activities and concentrate operations where power and policy align. At the same time, support for mining has not disappeared around the world. According to reports, up to 13 countries are supporting mining operations, including Russia, Japan, France, El Salvador, Bhutan, Iran, UAE, Oman, Ethiopia, Argentina and Kenya.
Price and market conditions
Bitcoin is trading around $88,600, down nearly 30% from its record high of $126,080 on October 6th. Markets are quiet towards the end of the year, and thin liquidity could mask real momentum.
Source: VanEck
BTC was observed to be stable near $89,000 in recent reports, but it remained range bound as traders weighed supply and demand signals. Movements between other assets are also important. Gold rose above $4,400 an ounce and silver hit $69.44 an ounce, moves some investors see as part of a broader safe-haven bid.
The data points suggest cautious optimism. Miner capitulation has historically served as a contrarian signal. Weak miners will exit, difficulty will be adjusted, and surviving operators will face less short-term selling pressure. This sequence stabilizes the price and sets the stage for months of profits.
Featured image from Pixabay, chart from TradingView
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